Ambitions Personnel Limited - Limited company accounts 22.3

REGISTERED NUMBER: 02684652 (England and Wales)

AMBITIONS PERSONNEL LIMITED

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MAY 2022

Page

Company Information

1

Strategic Report

2

to

3

Report of the Directors

4

to

5

Report of the Independent Auditors

6

to

8

Statement of Comprehensive Income

9

Statement of Financial Position

10

Statement of Changes in Equity

11

Statement of Cash Flows

12

Notes to the Statement of Cash Flows

13

Notes to the Financial Statements

14

to

22

DIRECTORS:

Mrs A A Watson

Mrs C Bishop

Mr P A Haggar

SECRETARY:

Mrs A A Watson

REGISTERED OFFICE:

18 Northgate

Sleaford

Lincolnshire

NG34 7BJ

REGISTERED NUMBER:

02684652 (England and Wales)

AUDITORS:

Duncan & Toplis Limited, Statutory Auditor

18 Northgate

Sleaford

Lincolnshire

NG34 7BJ

BANKERS:

National Westminster Bank Plc

225 High Street

Lincoln

Lincolnshire

LN2 1AZ

The directors present their strategic report for the year ended 31 May 2021.

REVIEW OF BUSINESS

We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and the non-complex nature of our business and is written in the context of risk and uncertainties we face.

As an employment agency, the Company has continued to provide labour into many different sectors of commerce and industry. Amongst others a large number of these are packing and food processing companies.

Results

Results for the financial year under review were lower than last year with turnover decreasing by £6.4m to £38.1m, a decrease of 14.4%. Despite this, the company has generated a profit before tax of £1.4m (2021: £2.5m) showing it can withstand a decrease in activity without negatively affecting profit margins.

With regards to the statement of financial position, net assets decreased in the period to £1.8m (2021: £2.6m).

Operations

The past growth of the Company has been achieved organically via expansion at existing branches and the opening of new branches.

The Company continues to look at opportunities to grow organically. One particular area that has allowed the Company to deal more directly with client needs in a cost effective manner, is the establishment, in conjunction with our larger clients, of offices on their premises. These offices mean we can deal with client issues as they arise and also allows us to deal with issues raised by our temporary staff in an efficient and effective way. This system also gives employees good communication with the site managers.

To enable the Company to attract new clients and retain existing ones the Company is committed to providing quality service and care to all clients through its workforce both permanent and temporary. The establishment of further on site offices has greatly assisted the serving of larger clients. The Company's diverse office base helps ensure that the Company can provide a wide catchment area of labour for their clients whilst expansion of their operating areas provides the ability to attract new clients from a wide geographical area.

New contracts have been gained and the directors are constantly assessing if it is appropriate to open new branches to service clients. This has continued to allow the Company to attract a general mix of SME and PLC clients in a variety of industries.

In addition this year the company against the background of general staff shortages arising from a mix of Brexit and COVID, have successfully expanded their permanent appointment service line. This has been a significant factor in the improved margin the company has achieved over the past year.

The general economic climate, particularly in the retail and food sectors can materially affect the Company's results along with the ability of the Company to continue to attract staff who are prepared to work on flexible terms. Brexit and COVID have been of significant influence in the past year on these core industries. In recognition of these risks to the Company the directors continue to strive to diversify the industries served by the Company to reduce the risks as far as possible.

With the risks and uncertainties in mind, we are aware that any plans for future development of the business may be subject to unforeseen future events outside of our control.

Employees

The Company is committed to the welfare of all employees and continues to attract and retain employees through this reputation. All staff receive appropriate health and safety training and, where applicable, food hygiene training.

A number of permanent employees are now located on site at clients to maintain our customer service.

PRINCIPAL RISKS AND UNCERTAINTIES

The continual increase in employment law and regulations is a major challenge to the Company as it keeps abreast of changes in the law and the court interpretation of employment regulations. The Company is therefore vigilant to such risks and has been inspected on various occasions. None of these inspections have given the directors any major concerns and have been a vindication of the internal control systems the Company operates.

The directors are aware that one risk is the concentration of turnover on particular clients. They have attracted additional new clients in the past to reduce this concentration and are continuing efforts to do this going forward.

The main developing issue that is a risk to the Company is Brexit. A large percentage of the Company's workforce are from EU countries so limiting the movement of labour to the UK harms the company's ability to employ staff. This is an issue that will develop over the coming months now that the deadline to apply to the settlement scheme has passed.

GOING CONCERN

The directors have considered the risks associated with the COVID-19 pandemic and have taken action where possible to limit the impact that it may have on the company's operations. The directors believe there is no uncertainty regarding the company's ability to remain a going concern.

ON BEHALF OF THE BOARD:

Mrs A A Watson - Director

17 October 2022

The directors present their report with the financial statements of the company for the year ended 31 May 2022.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of the operation of an employment agency providing temporary and permanent staff to employers within the United Kingdom.

DIVIDENDS

Interim dividends per share were paid as follows:

A Ordinary

£3.23

- 31 August 2021

£2.55

- 18 March 2022

B Ordinary

£3.23

- 31 August 2021

£2.55

- 18 March 2022

C Ordinary

£1.08

- 31 August 2021

£1.67

- 18 March 2022

D Ordinary

£1.34

- 18 March 2022

E Ordinary

£1.34

- 18 March 2022

The directors recommend that no final dividend be paid.

The total distribution of dividends for the year ended 31 May 2022 will be £1,983,789.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 June 2021 to the date of this report.

Mrs A A Watson

Mrs C Bishop

Mr P A Haggar

EMPLOYMENT STRATEGY

The Company encourages recruitment of the best person for the job regardless of gender, marital status, ethnic origin, disability, religious belief or age.

The Company is committed to the principle of equal opportunity and offers this to all staff in matters of career advancement, providing that they have the ability to perform their duties with or without training where necessary. If a member of staff becomes disabled whilst employed by the Company, retraining will be provided where required.

The Company places considerable value on the involvement of its employees and has continued its practice of keeping them informed of matters affecting them as employees, and on various matters affecting the performance of the Company.

The Company has a policy for recruitment of disabled persons and this includes a requirement to make reasonable adjustments to take disabilities into account. The Company makes career opportunities available to all people with disabilities and every practical effort will be made to provide for the needs of staff, candidates and clients. The same career development and promotion opportunities are made available to all of those within the company, regardless of disability.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

ON BEHALF OF THE BOARD:

Mrs A A Watson - Director

17 October 2022

Opinion

We have audited the financial statements of Ambitions Personnel Limited (the 'company') for the year ended 31 May 2022 which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 May 2022 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page five, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We have identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial experience, knowledge of the sector, a review of regulatory and legal correspondence and through discussions with Directors and other management obtained as part of the work required by auditing standards. We have also discussed with the Directors and other management the policies and procedures relating to compliance with laws and regulations. We communicated laws and regulations throughout the team and remained alert to any indications of non-compliance throughout the audit.

The potential impact of different laws and regulations varies considerably. Firstly, the company is subject to laws and regulations that directly impact the financial statements (for example financial reporting legislation) and we have assessed the extent of compliance with such laws as part of our financial statements audit.

Secondly, the company is subject to other laws and regulations where the consequence for non-compliance could have a material effect on the amounts or disclosures in the financial statements. We identified the following areas as those most likely to have such an effect: Health and Safety regulations and Employment laws.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Directors and other management and inspection. This inspection included an assessment of the company's employment and health and safety controls. Through these procedures, if we became aware of any non-compliance, we considered the impact on the procedures performed on the related financial statement items.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. The further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. As with any audit, there is a greater risk of non-detection of irregularities as these may involve collusion, intentional omissions of the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Simon Syddall BFP FCA (Senior Statutory Auditor)

for and on behalf of Duncan & Toplis Limited, Statutory Auditor

18 Northgate

Sleaford

Lincolnshire

NG34 7BJ

31 October 2022

TURNOVER

38,056,716

44,484,280

Cost of sales

33,629,985

39,427,125

GROSS PROFIT

4,426,731

5,057,155

Administrative expenses

2,984,638

2,692,631

1,442,093

2,364,524

Other operating income

35,092

169,035

OPERATING PROFIT

4

1,477,185

2,533,559

Interest receivable and similar income

701

1,139

1,477,886

2,534,698

Interest payable and similar expenses

5

65,131

35,748

PROFIT BEFORE TAXATION

1,412,755

2,498,950

Tax on profit

6

274,205

475,305

PROFIT FOR THE FINANCIAL YEAR

1,138,550

2,023,645

OTHER COMPREHENSIVE INCOME

Property revaluation

-

75,000

Income tax relating to other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

-

75,000

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,138,550

2,098,645

FIXED ASSETS

Tangible assets

8

226,435

278,847

Investment property

9

450,000

450,000

676,435

728,847

CURRENT ASSETS

Stocks

10

5,329

9,148

Debtors

11

7,552,378

9,339,296

Cash at bank and in hand

491,501

104,957

8,049,208

9,453,401

CREDITORS

Amounts falling due within one year

12

6,612,569

7,232,861

NET CURRENT ASSETS

1,436,639

2,220,540

TOTAL ASSETS LESS CURRENT LIABILITIES

2,113,074

2,949,387

CREDITORS

Amounts falling due after more than one year

13

395,943

387,017

NET ASSETS

1,717,131

2,562,370

CAPITAL AND RESERVES

Called up share capital

18

448

448

Revaluation reserve

19

254,098

254,098

Retained earnings

19

1,462,585

2,307,824

1,717,131

2,562,370

The financial statements were approved by the Board of Directors and authorised for issue on 17 October 2022 and were signed on its behalf by:

Mrs A A Watson - Director

Called up

share

Retained

Revaluation

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 June 2020

448

817,181

179,098

996,727

Changes in equity

Dividends

-

(533,002

)

-

(533,002

)

Total comprehensive income

-

2,023,645

75,000

2,098,645

Balance at 31 May 2021

448

2,307,824

254,098

2,562,370

Changes in equity

Dividends

-

(1,983,789

)

-

(1,983,789

)

Total comprehensive income

-

1,138,550

-

1,138,550

Balance at 31 May 2022

448

1,462,585

254,098

1,717,131

Cash flows from operating activities

Cash generated from operations

1

2,351,201

(376,365

)

Interest paid

(63,274

)

(35,748

)

Finance costs paid

(1,857

)

-

Government grants

11,374

133,575

Tax paid

(290,389

)

(654,868

)

Net cash from operating activities

2,007,055

(933,406

)

Cash flows from investing activities

Purchase of tangible fixed assets

(3,250

)

(117,067

)

Sale of tangible fixed assets

17,282

82,405

Interest received

701

1,139

Net cash from investing activities

14,733

(33,523

)

Cash flows from financing activities

Movement on invoice financing

(488,887

)

2,362,869

Amount introduced by directors

2,119,660

500,470

Amount withdrawn by directors

(1,282,228

)

(1,448,239

)

Equity dividends paid

(1,983,789

)

(533,002

)

Net cash from financing activities

(1,635,244

)

882,098

Increase/(decrease) in cash and cash equivalents

386,544

(84,831

)

Cash and cash equivalents at beginning of year

2

104,957

189,788

Cash and cash equivalents at end of year

2

491,501

104,957

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2022

2021

£

£

Profit before taxation

1,412,755

2,498,950

Depreciation charges

39,198

47,805

Profit on disposal of fixed assets

(1,343

)

(4,350

)

Government grants

(11,374

)

(133,575

)

Finance costs

65,131

35,748

Finance income

(701

)

(1,139

)

1,503,666

2,443,439

Decrease in stocks

3,819

3,686

Decrease/(increase) in trade and other debtors

1,062,254

(1,696,115

)

Decrease in trade and other creditors

(218,538

)

(1,127,375

)

Cash generated from operations

2,351,201

(376,365

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 May 2022

31.5.22

1.6.21

£

£

Cash and cash equivalents

491,501

104,957

Year ended 31 May 2021

31.5.21

1.6.20

£

£

Cash and cash equivalents

104,957

189,788

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1.6.21

Cash flow

At 31.5.22

£

£

£

Net cash

Cash at bank and in hand

104,957

386,544

491,501

104,957

386,544

491,501

Debt

Debts falling due within 1 year

(3,936,011

)

488,886

(3,447,125

)

(3,936,011

)

488,886

(3,447,125

)

Total

(3,831,054

)

875,430

(2,955,624

)

1.	STATUTORY INFORMATION

Ambitions Personnel Limited is a private company, limited by shares, registered in England and Wales. The company's registered number and registered office address can be found on the Company Information, on page 1 of of these financial statements.

The presentation currency of the financial statements in the Pound Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Turnover

Turnover represents amounts invoiced for the provision of labour services, excluding value added tax. Income is recognised on receipt of an appropriately authorised timesheet from a client. Income from permanent placements is taken when the candidate commences work.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold property

-

2% on cost

Improvements to property

-

10% on cost

Fixtures and fittings

-

15% on cost

Motor vehicles

-

15% on cost

Computer equipment

-

25% on cost

Tangible fixed assets are stated at cost less depreciation. The cost of tangible assets represents the invoice value of the assets, as well as other costs that are deemed necessary in order to bring the asset in to use.

Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing stock to its present location and condition. Cost is calculated using the first-in, first-out formula. Provision is made for damaged, obsolete and slow-moving stock where appropriate.

Taxation

Taxation for the year comprises of current tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

Confidential invoice discounting

The company obtains finance through confidential invoice discounting. As this facility is based on total trade debtors at any point in time and this figure is a constantly varying, the advance is shown as a creditor under "loans due within one year". Trade debtors are stated gross without deduction of the debt raised on them.

Financial instruments

The company has adopted the Sections 11 and 12 of FRS 102 in respect of financial instruments.

Basic financial assets, including trade and other debtors and cash and bank balances are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in the income statement.

Basic financial liabilities, including trade and other creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Critical accounting judgements and estimation uncertainty

In the application of the Companies accounting policies, management is required to make judgements, estimates and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

(i) Debt instruments held at amortised cost

The company has loans which are interest free and as a result of this need to be amended to amortised cost. In the assessment of the amortised cost there is an estimation as to what the interest charge from the bank would be on a similar loan in terms of size and length. The estimation of the interest rate is the resultant discount rate used. This is reassessed annually to take into account the risk profile of the company which would lead to a change in the interest rate.

(ii) Useful economic life of property, plant and equipment

The annual deprecation charge for property, plant and equipment is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect the current estimates, based on use by the company and the physical condition of the assets.

(iii) Holiday pay provision

The company offers short-term employment benefits in the form of holiday pay to both it's permanent and temporary staff. Due to the holiday year end and the financial reporting date being non-coterminous this results in a holiday pay provision arising. As a result the company looks to use its wages information to make an estimate of the cost this has to the company. Due to the demographic of staff the company employs this can lead to holiday not being taken. The company looks to make adequate allowance for this when calculating the provision.

3.	EMPLOYEES AND DIRECTORS

2022

2021

£

£

Wages and salaries

1,571,308

1,520,194

Social security costs

181,400

149,489

Other pension costs

262,881

245,878

2,015,589

1,915,561

The average number of employees during the year was as follows:

2022

2021

Administration

62

60

Directors

3

3

65

63

The staff costs note includes permanent employees only as temporary employee numbers fluctuate monthly. Temporary employee costs are a direct cost of sale and as such have not been included under staff costs.

2022

2021

£

£

Directors' remuneration

29,232

29,232

4.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2022

2021

£

£

Depreciation - owned assets

39,723

47,805

Profit on disposal of fixed assets

(1,343

)

(4,350

)

Auditors' remuneration

12,700

12,000

Operating leases - other assets

53,546

46,489

Operating leases - buildings

138,438

144,182

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

2022

2021

£

£

Bank interest

688

45

Invoice finance interest

53,931

41,731

Loan interest

8,655

(6,028

)

HMRC Interest

1,857

-

65,131

35,748

6.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2022

2021

£

£

Current tax:

UK corporation tax

274,205

475,347

Adjustment re previous years

-

(42

)

Tax on profit

274,205

475,305

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2022

2021

£

£

Profit before tax

1,412,755

2,498,950

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2021 - 19%)

268,423

474,801

Effects of:

Expenses not deductible for tax purposes

3,564

494

Depreciation in excess of capital allowances

2,218

52

Adjustments to tax charge in respect of previous periods

-

(42

)

adjustments

Total tax charge

274,205

475,305

Tax effects relating to effects of other comprehensive income

There were no tax effects for the year ended 31 May 2022.

2021

Gross

Tax

Net

£

£

£

Property revaluation

75,000

-

75,000

7.

DIVIDENDS

2022

2021

£

£

A and B Ordinary shares of £0.001 each

Interim

1,555,435

390,340

C Ordinary shares of £0.001 each

Interim

368,354

82,630

D and E Ordinary shares of £0.001 each

Interim

60,000

60,032

1,983,789

533,002